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Erie Company manufactures a small CD player called the Jogging Mate. The company uses standards to control its costs. The labor standards that have been set for one Jogging Mate CD player are as follows: During August, 5,750 hours of direct labor time were needed to make 20,000 units of the Jogging Mate. The direct labor cost totaled 73,600 for the month.
(c) The budgeted variable manufacturing overhead rate is 4 per direct labor-hour. During August, the company incurred 21,850 in variable manufacturing overhead cost. Compute the variable overhead rate and efficiency variances for the month.

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abhaydwive123

Standard labor time per unit = 18 minutes / 60 minutes

= 0.3

Number of units manufactured 20000

Standard labor time per unit 0.3

Total standard hours labor time allowed $6000(20000*0.3)

The standard labor rate per hour is $12

The total standard direct labor cost is $72000(6000*12)

The actual direct labor cost is $73600

Standard direct labor cost $72000

Variance $1600 unfavorable.  

Standard labor is the average amount of time it takes an average worker to perform a task correctly. Although the definition is simple, there are some key elements. First, the working standard is a measure of time. That is, the time it takes to complete a job. Then it assumes that the task will run correctly.

Learn more about standard labor at

https://brainly.com/question/26082424

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